U.S. sets preliminary duties on plywood from China

U.S. sets preliminary duties on plywood from China

While this is a step in the right direction, we shouldn’t think that the battle is over because the same plywood manufacturers who were “dumping” their plywood products will realize that they can get around this duty by offering cut-to-size plywood which is not subject to the same regulations. So, these new regulations will shift the pain of this market inequity to the local businesses who might well be selling these plywood products as a cut-to-size product, something the Asian manufacturers didn’t have much interest in before.

The move represents a victory for U.S. plywood producers in
North Carolina, New York and Oregon who filed a petition last
year asking for import relief.

The Coalition for Fair Trade of Hardwood Plywood accused
Chinese manufacturers and exporters of “dumping” the plywood in
the United States at prices 298 percent to 322 percent below
fair market value.

They also asked for countervailing duties to offset alleged
Chinese government subsidies given to the companies.

The Commerce Department’s preliminary duties on Wednesday
covered only the subsidy portion of the case. It will announce
preliminary anti-dumping duties by the end of April. A final
decision on both types of duties is expected in July.

The United States imported about $617 million of the
hardwood and decorative plywood from China in 2011, down from
$635 million in 2010. The wood is used for cabinets, flooring
and other housing applications.

Will this have any impact on supplies of logs and lumber for those of us who live in that world primarily? Maybe! Think about this. We ship a tremendous amount of logs to the Far East that go into plywood production. This is primarily in the whiter – softer hardwoods to make veneer core for plywoods but also includes some(?) percentages of hardwoods like red oak, maple, cherry, hickory, etc., for “fancy face” plywoods. So, any of those log that are not sent to the Far East for plywood would be available here for plywood production here or even for hardwood lumber production.

Other distributors have indicated that it is only China who is being penalized with a “duty” situation and that Vietnam and Malaysia have plenty of plywood producers that can absorb significant quantities of logs from the U.S. So, this may be a “shell game” and the only thing that will change will be that the “pea” is under Vietnams(?) shell instead of China’s. However, we do know from our own plywood suppliers that the price of plywood is going to go up right away. How much? I don’t know because some of the increases have already been factored in, in the previous three months.